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1 |
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Economics as a Social Science |
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Krugman. "Accidental Theorist." |
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2 |
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Review of Supply and Demand in the Context of the Minimum Wage Debate: Assumptions Behind Competitive Model of Wage Setting, Monopsony Model |
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Nicholson. Microeconomic Theory: Basic Principles and Extensions. Chap. 1.
Freeman. "Comment: The New Economics of the Minimum Wage."
Kennan. "The Elusive Effects of Minimum Wages."
Readings for class discussion:
Card and Krueger. "Minimum Wages and Employment: A Case Study of the Fast-food Industry in New Jersey and Pennsylvania."
Supplemental reading:
Card and Krueger. Myth and Measurement: The New Economics of the Minimum Wage. |
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Problem set 1 (PDF) distributed |
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3 |
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Whistle-stop Tour of Mathematical Tools for 14.03: Unconstrained Optimization, Constrained Optimization, Implicit Function Theorem, Envelope Theorem for Unconstrained and Constrained Problems, Duality |
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Nicholson. Microeconomic Theory... Chap. 2.
Supplemental reading :
Binger and Hoffman. Microeconomics with Calculus. 2nd edition. Chaps. 1–3. |
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4 |
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Choice and the Theory of Demand: Rationality Axioms, Utility, Indifference Curves, Constrained Utility Maximization |
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Nicholson. Microeconomic Theory... Chap. 3 and 4. |
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Problem set 1 due |
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5 |
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Individual Demand, Income and Substitution Effects |
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Nicholson. Microeconomic Theory... Chap. 5. |
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Problem set 2 (PDF) distributed |
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6 |
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Engel's Law
Normal, Inferior and Giffen Goods
Marshallian vs Hicksian Demand
The Weak Axiom of Revealed Preference |
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Reading for class discussion:
Dwyer and Lindsey. "Robert Giffen and the Irish Potato." |
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7 |
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Applications of Consumer Theory: Lump-sum v. In-kind Transfers, Taxes and Rebates, and the Distortionary Effects of Taxation, Price Changes and Consumer Surplus |
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Reading for class discussion:
Waldfogel. "The Deadweight Loss of Christmas." |
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Problem set 2 due
Problem set 3 (PDF) distributed |
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8 |
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Price Indices: Demand Relationships Among Goods: Net Substitutes and Complements, Gross Substitutes and Complements |
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Nicholson. Microeconomic Theory... Chap. 6.
Krugman. "The CPI and the Rat Race."
Readings for class discussion:
Boskin, et al. "Towards a More Accurate Measure of the Cost of Living."
Newspaper article(s) to be distributed in class. |
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9 |
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Complements and Substitutes |
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Nicholson. Microeconomic Theory... Chap. 7. |
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Problem set 3 due |
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10 |
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First Exam |
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11 |
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Choice Under Uncertainty, Risk and Risk Aversion, Insurance (Partial review from 14.01) |
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Nicholson. Microeconomic Theory... Chap. 8. |
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12 |
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Application of Theory of Choice: Demand for Abortions, Effects of Abortion Restrictions on Abortions and Birth Rates |
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Readings for class discussion:
Kane and Staiger. "Teen Motherhood and Abortion Access." |
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Problem set 4 (PDF) distributed |
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13 |
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Continuation of Risk and Choice: Demand for Abortions, Effects of Abortion Restrictions on Abortions and Birth Rates |
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14 |
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Prices and Perfect Competition |
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Reading for class discussion:
Scherer. "The U.S. Sugar Program." |
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Problem set 4 due
Problem set 5 (PDF) distributed |
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15 |
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General Equilibrium in a Pure Exchange Economy |
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Nicholson. Microeconomic Theory... Chap. 16 and 17 (part). |
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16 |
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General Equilibrium (continued) |
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Krugman. "A Raspberry for Free Trade."
Reading for class discussion:
Krugman. "Competitiveness: A Dangerous Obsession." |
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17 |
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General Equilibrium (wrap-up)
Limits of the market (if time permits) |
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Nicholson. Microeconomic Theory... Chap. 24.
Reading for class discussion:
Krugman. "The Tax Reform Obsession." |
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Problem set 5 due |
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18 |
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Second Exam |
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19 |
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Economics of Information I: Why is Information Different? |
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Nicholson. Microeconomic Theory... Chap. 9.
Rothschild and Siglitz. "Equilibrium in Competitive Insurance Markets: An Essay on the Economics of Information." |
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20 |
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Insurance Markets (continued) |
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Readings for class discussion:
Altman, Cutler, and Zeckhauser. "Adverse Selection and Adverse Retention." |
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Problem set 6 (PDF) distributed |
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21 |
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Economics of Information II: The Market for Lemons: Adverse Selection in Product Markets |
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Readings for class discussion:
Akerlof. "The Market for Lemons: Quality Uncertainty and the Market Mechanism." |
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22 |
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Economics of Information III: Human Capital and Job Market Signaling |
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Spence. "Job Market Signaling." |
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Problem set 6 due
Problem set 7 (PDF) distributed |
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23 |
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Application of Signaling: The General Educational Development Certificate |
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Readings for class discussion:
Tyler, Murnane, and Willet. "Estimating the Labor Market Signaling Value of the GED." |
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24 |
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An Introduction to Game Theory |
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Nicholson. Microeconomic Theory... Chap. 10. |
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Problem set 7 due
Problem set 8 (PDF) distributed |
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25 |
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Game Theory (continued) |
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Nicholson. Microeconomic Theory... Chap. 10. |
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26 |
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Network Externalities in the Information Age: A Model of Network Externalities |
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Readings for class discussion:
Shapiro, and Varian. Information Rules. Chap. 7.
David. "Clio and the Economics of QWERTY."
Krugman. "Entertainment Values." |
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Problem set 8 due
Problem set 9 distributed (not for credit) |
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27 |
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Network Externalities (continued)
Price Discrimination and Versioning
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Reading for class:
Shapiro and Varian. Information Rules. Chap. 3. |
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